Missing Herb Yet?

[swamt]

No.  Herb just made it look easier.  Now what does that tell ya???
And trust me WT, nobody, repeat nobody, had it worse than Herb when had to fight all the years to keep SWA flying...

 

[WorldTraveler]

Herb was a great lawyer and won a lot of legal battles but Herb still had a low cost structure and an abundance of new market opportunities to build on which Gary doesn't have today.

The simple reality is that the US domestic market is not growing and WN doesn't have the ability to stimulate traffic as it once had.

WN will try to do what they once did with the WN effect in Latin America but it is not likely they will succeed to anywhere near the same degree simply because there are many carriers that have costs that are as low or lower than WN esp. when operating to similar destinations.

 

[eolesen]

The real advantage Herb had was Founder's Charisma.

He built up goodwill chits with the unions over his ~three decades as CEO, something that didn't transfer over to Gary Kelly or Jim Parker.

It's a fairly common phenomena. CR Smith had it, CE Woolman had it, Larry Risley had it, David Neeleman had it.

Even Gordon Bethune had it (arguably, the post bankruptcy CO had little in common with its predecessors).

And it's hardly unique to airlines. Just look at Home Depot after Bernie and Arthur retired... the same will also happen at Apple post-Steve Jobs.

 

[swamt]

I do tend to agree with you guys.  Gary will have a harder time to get the same results, but I do think it will come over the next few years.  The best area SWA has is the international market, I am sure it will be huge for SWA.  Record profits have started for SWA and I see them continuing for the next few years.  And I hope the entire airline industry will continue to show record profits as this is good for all of us...

 

[Kev3188]

Larry Risley had it,

Wow, that's a name I hadn't heard in awhile! I wonder how he would've felt about what Ornstein turned his carrier into?

YV was a bit of a hot mess even at the end of LR's tenure, but the shift in employee attitude you noted definitely occurred once he left (at least in my experience, anyway)...

 

[WorldTraveler]

It is correct that the founders of airlines in the US and around the world all had a charisma about them that allowed them to accomplish a lot of things that others have not.
However, that principle is not restricted just to the airline industry but is typical of many legendary business execs including people like Steve Jobs.
There is an excitement about building something new that allows a leader to get people behind them.
Herb was most definitely in the same camp.
Yet organizational life cycle dynamics also show that all organizations – and businesses – hit a phase where the “newness” wears off, challenges arise that are beyond what can be accomplished just by rallying the troops (including the loss of competitive advantage which the startup company once had), and new leaders who have to maintain and grow the organization have to be found.
“Maintainers” are rarely as charismatic as “founders.”
Further, there comes a point where even the maintainers can’t keep the momentum growing, usually because of external influences, or at times, internal failure.
WN’s challenges are less about internal issues – although the labor/mgmt. relationship at WN IS changing – as it is about a changed external environment where WN doesn’t have the advantages it once did.
Swamt wants to criticize legacy airlines for using bankruptcy but it is precisely the intent of BK to allow a company to restructure and become viable companies again.
The fact that DL came out of BK as a much stronger company, pulled off one of the smoothest and largest mergers in the history of aviation, and has focused aggressively on shoring up DL’s remaining strategic needs is precisely because DL did its homework in BK so that it could succeed as soon as it came out.
CO did the very same thing after BK 2. CO was the darling of the industry for years. Part of their success was because they went after new revenue opportunities such as building EWR which other carriers including AA and DL do not do; both AA and DL largely ignored NYC and operated it along their historic market strengths instead of competing against each other.
Yet, CO’s strength in the NYC market perfect mirrors its own peak after BK. CO’s costs began to rapidly increase and competition in the NYC market grew dramatically – largely from DL that decided it too wanted to be a major player in NYC.
CO might have reinvented itself again as good companies do when they hit plateaus, and they will continue to do that as part of the organizational life cycle. But CO decided to merge with UA instead and the life cycle issues for CO became secondary to merger and cultural issues with UA which are far more deeply ingrained.
WN is in EXACTLY the same life cycle position as CO and DL were PRIOR to BK. WN is a strong enough company that they likely won’t have to go into BK in order to reorganize but WN is not and cannot be the same company it has been as much as swamt wants to fight that reality.
WN will succeed. I have repeatedly said that. But WN is having to give up being a niche, low cost and low fare airline because there are no more markets where it can grow and many of its original markets don’t work at its higher cost.
Thus, WN IS becoming more and more like a legacy carrier – and is facing many of the same problems that the legacy carriers faced years ago.
The legacy carriers managed to successfully restructure and consolidate and are fighting back against the low cost carriers that were the bane of the legacy carriers for decades after deregulation.
The DOJ may try to give a preference to WN and other carriers but the question will be decided in the marketplace. WN has to adapt, Herb is not the kind of person who can return WN to its former grandeur because Herb ha an entirely different set of leadership skills, and the WN of tomorrow CAN BE stronger than the one today – as long as people like swamt quit trying to argue against the change that is inevitable in life.

 

[Overspeed]

It is correct that the founders of airlines in the US and around the world all had a charisma about them that allowed them to accomplish a lot of things that others have not.
However, that principle is not restricted just to the airline industry but is typical of many legendary business execs including people like Steve Jobs.
There is an excitement about building something new that allows a leader to get people behind them.
Herb was most definitely in the same camp.
Yet organizational life cycle dynamics also show that all organizations – and businesses – hit a phase where the “newness” wears off, challenges arise that are beyond what can be accomplished just by rallying the troops (including the loss of competitive advantage which the startup company once had), and new leaders who have to maintain and grow the organization have to be found.
“Maintainers” are rarely as charismatic as “founders.”
Further, there comes a point where even the maintainers can’t keep the momentum growing, usually because of external influences, or at times, internal failure.
WN’s challenges are less about internal issues – although the labor/mgmt. relationship at WN IS changing – as it is about a changed external environment where WN doesn’t have the advantages it once did.
Swamt wants to criticize legacy airlines for using bankruptcy but it is precisely the intent of BK to allow a company to restructure and become viable companies again.
The fact that DL came out of BK as a much stronger company, pulled off one of the smoothest and largest mergers in the history of aviation, and has focused aggressively on shoring up DL’s remaining strategic needs is precisely because DL did its homework in BK so that it could succeed as soon as it came out.
CO did the very same thing after BK 2. CO was the darling of the industry for years. Part of their success was because they went after new revenue opportunities such as building EWR which other carriers including AA and DL do not do; both AA and DL largely ignored NYC and operated it along their historic market strengths instead of competing against each other.
Yet, CO’s strength in the NYC market perfect mirrors its own peak after BK. CO’s costs began to rapidly increase and competition in the NYC market grew dramatically – largely from DL that decided it too wanted to be a major player in NYC.
CO might have reinvented itself again as good companies do when they hit plateaus, and they will continue to do that as part of the organizational life cycle. But CO decided to merge with UA instead and the life cycle issues for CO became secondary to merger and cultural issues with UA which are far more deeply ingrained.
WN is in EXACTLY the same life cycle position as CO and DL were PRIOR to BK. WN is a strong enough company that they likely won’t have to go into BK in order to reorganize but WN is not and cannot be the same company it has been as much as swamt wants to fight that reality.
WN will succeed. I have repeatedly said that. But WN is having to give up being a niche, low cost and low fare airline because there are no more markets where it can grow and many of its original markets don’t work at its higher cost.
Thus, WN IS becoming more and more like a legacy carrier – and is facing many of the same problems that the legacy carriers faced years ago.
The legacy carriers managed to successfully restructure and consolidate and are fighting back against the low cost carriers that were the bane of the legacy carriers for decades after deregulation.
The DOJ may try to give a preference to WN and other carriers but the question will be decided in the marketplace. WN has to adapt, Herb is not the kind of person who can return WN to its former grandeur because Herb ha an entirely different set of leadership skills, and the WN of tomorrow CAN BE stronger than the one today – as long as people like swamt quit trying to argue against the change that is inevitable in life.

 
Crandall wasn't a founder but he has a following at AA. Honesty and comeptitiveness is a good trait to have. I would say during my tenure at AA he made no bones about he was going to shrink the airline to profitablity and we all knew that meant layoffs. He never cut or ask to cut our pay.

 

[Overspeed]

The real advantage Herb had was Founder's Charisma.

He built up goodwill chits with the unions over his ~three decades as CEO, something that didn't transfer over to Gary Kelly or Jim Parker.

It's a fairly common phenomena. CR Smith had it, CE Woolman had it, Larry Risley had it, David Neeleman had it.

Even Gordon Bethune had it (arguably, the post bankruptcy CO had little in common with its predecessors).

And it's hardly unique to airlines. Just look at Home Depot after Bernie and Arthur retired... the same will also happen at Apple post-Steve Jobs.

 
All you had to do was not be an a**hole like Lorenzo and you were at god-like status with CO employees.

 

[WorldTraveler]

Crandall wasn't a founder but he has a following at AA. Honesty and comeptitiveness is a good trait to have. I would say during my tenure at AA he made no bones about he was going to shrink the airline to profitablity and we all knew that meant layoffs. He never cut or ask to cut our pay.

 
he would be considered a builder in the concept of organizational life cycles... and he was very good at his role. He may not have been responsible for AA's earliest growth and innovations but he was unquestionably one of the most influential leaders of the legacy segment of the industry post WWII - and that covers a lot of years.

But you also notice that he didn't come back out of retirement as many at AA wanted because he is not the kind of person to fix others mistakes and to restore what is broken.

People who do that kind of work are usually not terribly high profile and they are also usually not long-lasting.
There are people who can help organizations transition to a new reality but they usually don't become the same people who rebuild it after things stabilize.

Transition people usually have to do messy stuff, shut down things that don't work, reset expectations and a whole lot of other stuff that people don't want to be reminded of years after the dirty work has been done.

It very may well be in WN's case that Gary Kelly is the person to navigate WN thru the transitional years it is now in but he won't be the one that will stick around post transition to guide WN well into the future. I"m not betting but I wouldn't be surprised if that is the case.


 

All you had to do was not be an a**hole like Lorenzo and you were at god-like status with CO employees.

it also highlights how badly CO was broken and also how fast the turnaround became once they refocused on doing what they could do... and CO did it very well and was basically a runaway success for more than a decade.

But CO people were losing faith in CO leadership as it became apparent that the wonder years wouldn't last for ever - and the increased competition and the strategic isolation that CO faced made it all the more necessary for CO to move forward... and the reality is that CO people will likely never experience again what they did during the golden years.

There are companies that have fallen from a leadership position and then regained it but that usually takes a long time to repeat and most of the people and culture that made it happen no longer work the 2nd time around.

To be clear, WN will reinvent itself and succeed - but those who want to continue to believe that the WN of yesteryear is still here or will be the WN of tomorrow will be disappointed.

 

[southwind]

Let is know when they bargain for and vote themselves a paycut.

It's called Bankruptcy, which negates all contracts.

 

[700UW]

Really it does?
 
Another one of your ignorant posts.

Filing Bankruptcy does no such thing.
 
Go read about Section 1113 C of the bankruptcy code.

 

[southwind]

So your telling me Union members don't take any kind of hit, during a BK?
 
Is your address still 123 Disneyland Way?

 

[700UW]

Did I say that?

You stated contracts are negated, that's is wrong.

I led you to the water, but you don't know how to drink.

Once again educate yourself on section 1113 C of the bankruptcy code.

 

[swamt]

Moderators need to shut this thread down.  Why do they constantly allow all these entrants and continue the off topic BULL **** to continue???   Some one needs to take control of this **** and now...

 

[WorldTraveler]

except it does have relevance to where WN is now.

For years, WN employees talked about the advantage that WN had by NOT filing BK.

With every legacy airline now having gone thru it, WN has the liability of having higher paid employees.

Just one example is topped out 737/320 pay since that aircraft is something of the baseline for pilot pay at every airline.

WN's pay at $219/hr is the highest; DL and UA are both a few dollars below WN's although both of those airlines have larger aircraft that pay more. The rest of the industry including other LCCs plus AA/US pay less than WN.

http://www.airlinepilotcentral.com/airlines

It is precisely why labor negotiations this go around are as difficult as they are for WN and its unions.

WN simply cannot write the checks that labor has expected them to write in the past.